Small Business Embraces Big Govt.

Published May 5, 2011 at 8:18 AM | Updated at 9:20 AM PDT on May 9, 2011

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If you want to understand the confused thinking and cynicism that pervades the business lobby, you should read this item at Fox & Hounds Daily from the California executive director of the National Federation of Independent Business.

In short, the director, John Kabateck, argues this: the best thing for small business is big government.

Of course, he doesn't say this out and out. Instead, he rails against a bill that would give taxing power to counties. Kabateck prefers the status quo in California, where the only elected officials who can raise taxes are state officials in Sacramento.

But it never occurs to Kabateck that one beneficiary of giving taxing power to counties might be small businesses. Instead of having to hire lobbyists or fly to Sacramento, they could make democratic arguments for lower taxes, less regulation and pro-business policies at the local level. It was precisely this kind of political participation by the business community that was at the core of California's greatest economic successes throughout history. Local business activism, in the era before taxation became centralized in Sacramento, helped make this state a center for oil, aerospace, and technology.

The centralization of taxation hasn't been good for California government or the California economy. It has been good for the job security of those who represent business in Sacramento -- and can tell their members that they are protecting them from the scourge of taxation. What these lobbyists really are protecting business from are the benefits of democracy.